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The transfusion division of health care giant Abbott screens about half of the U.S. blood supply, so the nationwide decline in blood donations since the COVID pandemic has been not only a public health problem but, for Abbott, a business problem. The company tackled the dilemma by appealing to college students’ competitive streak: Last year, it launched the “We Give Blood” campaign among students at schools in the Big Ten conference, coinciding with the college football season. 

The 2024 initiative resulted in nearly 20,000 donations, enough to save up to 60,000 lives. First-time donors represented 69% of We Give Blood participants. In and around the University of Nebraska—the school that won the competition—local blood centers saw a 27% increase in young donors (ages 16 to 24) versus the previous year. Season two kicked off this September, and is attracting donors at an even faster rate: It neared 20,000 donations in just the first four weeks of the drive.

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CTW-2023-Abbott-Graduation-F2S1

Student debt is a massive burden in the U.S. There are more than 43 million borrowers carrying a combined $1.8 trillion in obligations. Debtors often have to choose between paying off their student loans or saving for retirement. That’s why Abbott developed Freedom 2 Save. F2S is a benefit program in which enrolled employees who put 2% of their pay toward their student loans get a corporate match of 5% into their 401(k)s—keeping them from having to sacrifice their future to pay off their past. The health care company’s innovative offering required special permission from the IRS before it could launch in 2018. To date, Abbott has contributed more than $5.5 million to over 2,500 of its employees, including $1.7 million in 2022 alone. Beginning in 2024, all U.S. employers will be able to offer a similar benefit through a provision of the SECURE 2.0 Act—inspired by Abbott’s offering—which will enable employers to match employees’ student loan payments with 401(k) contributions.

The Fortune 500, in its 69th year in 2023, ranks the biggest U.S. companies by revenue.

F500-2023-099-Abbott Labortories

Riding the tail end of a sales boom in COVID-19 tests, the medical device and health care products firm dropped 13 spots on the Fortune 500 in 2022, with revenue increasing only 1.3% and profits down 2%. 
<ul> 
 	<li>COVID-19 test revenue accounted for one-fifth of Abbott’s bottom line in 2022, jumping to $8.4 billion from $7.7 billion in 2021. At the end of the first quarter of 2023, the firm projected test sales to drop to $1.5 billion for the year.</li> 
 	<li>Abbott fed some of its COVID-19 test proceeds into research and development, investing an additional $2 billion in 2022.</li> 
 	<li>The Department of Justice is investigating Abbott’s infant formula plant in Michigan, which shut down from February to June 2022 owing to contamination, setting off a nationwide shortage.</li> 
</ul>

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Aggregate sales hit $37.8 trillion last year—an increase of 19%, the highest annual growth rate in the list’s history.

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GPTW Health Care Large 2022-Abbott Laboratories_1000884-3 copy

Employees say: 
 
“I have never worked at a company that has put so much effort into making sure that their employees are taken care of. Abbott seems to go to great lengths to help employees, their family and the community.”

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F500-2022-086-Abbott Laboratories

COVID-19 testing continued to drive revenue growth for Abbott Labs in 2021: As of January 2022, the company had distributed about 1.4 billion tests, and those generated $7.7 billion in sales in 2021. Medical devices and nutrition products like Similac and Ensure together account for about two-thirds of Abbott’s revenue. The nutrition division endured a setback in early 2022, however, when Abbott issued a voluntary recall of powdered infant formula manufactured in one of its facilities in Michigan after the plant was linked to a bacterial-infection outbreak; the shutdown contributed to a nationwide formula shortage.

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WMAC 2021-42-Abbott Laboratories

Total revenue for the world’s biggest companies fell 4.8% to $31.7 trillion this year—the first decline in half a decade.

<span data-sheets-value="{&quot;1&quot;:2,&quot;2&quot;:&quot;Abbott Laboratories leveled up on this year’s Fortune 500 list, leaping from last year’s rank of 104 to No. 89. Why? COVID testing. Abbott was one of the first to jump into the testing market, and that alacrity has paid off; the company’s diagnostics unit, which also houses its COVID test arm, raked in more than $4 billion in sales during the first quarter of 2021 alone. Abbott, though, isn’t putting all its eggs in one basket. As life starts returning to normal, the company believes its diabetes care and glucose monitoring products will continue to fuel growth. &quot;}" data-sheets-userformat="{&quot;2&quot;:12673,&quot;3&quot;:{&quot;1&quot;:0},&quot;10&quot;:2,&quot;11&quot;:4,&quot;15&quot;:&quot;Calibri, Arial&quot;,&quot;16&quot;:11}" data-sheets-textstyleruns="{&quot;1&quot;:0}{&quot;1&quot;:46,&quot;2&quot;:{&quot;6&quot;:1}}{&quot;1&quot;:53}">Abbott Laboratories leveled up on this year’s Global 500 list, leaping from last year’s rank of 393 to No. 350. Why? COVID testing. Abbott was one of the first to jump into the testing market, and that alacrity has paid off; the company’s diagnostics unit, which also houses its COVID test arm, raked in more than $4 billion in sales during the first quarter of 2021 alone. Abbott, though, isn’t putting all its eggs in one basket. As life starts returning to normal, the company believes its diabetes care and glucose monitoring products will continue to fuel growth.

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Best Workplaces Healthcare Large 2021-Abbott Laboratories

Employees say: 
“It's really amazing to be part of a team where everyone does their best to help and assist on various projects in addition to their responsibilities.” 
Read Great Place to Work review .

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F500-2021-89-Abbott Laboratories

<span data-sheets-value="{&quot;1&quot;:2,&quot;2&quot;:&quot;Abbott Laboratories leveled up on this year’s Fortune 500 list, leaping from last year’s rank of 104 to No. 89. Why? COVID testing. Abbott was one of the first to jump into the testing market, and that alacrity has paid off; the company’s diagnostics unit, which also houses its COVID test arm, raked in more than $4 billion in sales during the first quarter of 2021 alone. Abbott, though, isn’t putting all its eggs in one basket. As life starts returning to normal, the company believes its diabetes care and glucose monitoring products will continue to fuel growth. &quot;}" data-sheets-userformat="{&quot;2&quot;:12673,&quot;3&quot;:{&quot;1&quot;:0},&quot;10&quot;:2,&quot;11&quot;:4,&quot;15&quot;:&quot;Calibri, Arial&quot;,&quot;16&quot;:11}" data-sheets-textstyleruns="{&quot;1&quot;:0}{&quot;1&quot;:46,&quot;2&quot;:{&quot;6&quot;:1}}{&quot;1&quot;:53}">Abbott Laboratories leveled up on this year’s Fortune 500 list, leaping from last year’s rank of 104 to No. 89. Why? COVID testing. Abbott was one of the first to jump into the testing market, and that alacrity has paid off; the company’s diagnostics unit, which also houses its COVID test arm, raked in more than $4 billion in sales during the first quarter of 2021 alone. Abbott, though, isn’t putting all its eggs in one basket. As life starts returning to normal, the company believes its diabetes care and glucose monitoring products will continue to fuel growth.

For an astounding 13th straight year, Apple claims the top spot in Fortune’s annual ranking of corporate reputation, based on a survey of almost 3,800 executives, directors, and analysts.

This year's Fortune Global 500 generated $33.3 trillion in revenues and $2.1 trillion in profits.

G500-2020-393-Abbott-Laboratories

Health care company Abbott Labs manufactures medical devices, diagnostic tools, and nutritional products like Ensure. While the pandemic has depressed some aspects of Abbott's business, demand for COVID-19 testing has buoyed its diagnostic arm.

The best workplaces in health care and biopharma make their employees feel valued while the health care industry continues to undergo rapid technological changes.

Best Workplaces in Health Care and Biopharma-2020-Abbott Laboratories

Employees say: 
“People aren't just here to earn their paychecks, but to make high quality products for the people that depend on them. The people also really care about each other here and go out of their way to ensure that everyone is comfortable.” 
Read Great Place to Work review .

This year's Fortune 500 marks the 66th running of the list.

F500-2020-104-Abbott-Laboratories

Health care company Abbott Labs manufactures medical devices, diagnostic tools, and nutritional products like Ensure.

As we face unprecedented collective challenges, cooperation has become a business superpower.

24.CTW20.Abbott

Health care access is a challenge in Rwanda, which makes one diagnostic innovation by Abbott Labs particularly valuable. Abbott’s prenatal panel tests simultaneously for syphilis, malaria, HIV, and hepatitis B, using only one finger-stick of blood, with results in the same visit. For expectant mothers who may have time or resources for only one trip to the clinic, that means better care; the test has also enabled a tripling of malaria case detections. 
 
At press time, health care providers were just beginning to deploy another potentially crucial Abbott diagnostic product: An “antigen” test for COVID-19 that yields results in 15 minutes and costs $5.

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Wal-Mart stayed on top as its sales crept closer to half-a-trillion dollars. Apple moved into the top five. And UnitedHealth Group continued its steady climb. 

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Abbott Laboratories is a global health care company. Founded in 1888, the company operates in four main segments: established pharmaceutical products, diagnostic products, nutritional products—including infant formula—and medical devices. As of 2024, Abbott’s medical devices segment was its largest and fastest-growing, accounting for about 45% of revenue. That segment includes devices for monitoring cardiovascular health, glucose monitoring systems for diabetes care, and neuromodulation devices for chronic pain and movement disorders.

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Abbott Laboratories (ABT): Company Profile, Stock Price, News, Rankings

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Abbott Laboratories

abbott laboratories

Good morning, and thank you for standing by. Welcome to Abbott's Second Quarter twenty twenty five Earnings Conference Call. All participants will be able to listen only until the question and answer portion of this call. During the question and answer session, you will be able to ask your question by pressing the star one, one keys on your touch tone phone. This call is being recorded by Abbott.

With the exception of any participants' questions asked during the question and answer session, the entire call, including the question and answer session, is material copyrighted by Abbott. It cannot be recorded or rebroadcast without Abbott's expressed written permission. I would now like to introduce Mr. Mike Camilla, Vice President, Investor Relations.

Good morning, and thank you for joining us. With me today are Robert Ford, Chairman and Chief Executive Officer and Phil Boudreaux, Executive Vice President, Finance and Chief Financial Officer. Robert and Phil will provide opening remarks. Following their comments, we'll take your questions. Before we get started, some statements made today may be forward looking for purposes of the Private Securities Litigation Reform Act of 1995, including the expected financial results for 2025.

Abbott cautions that these forward looking statements are subject to risks and uncertainties that may cause actual results to differ materially from those indicated in the forward looking statements. Economic, competitive, governmental, technological, and other factors that may affect Abbott's operations are discussed in Item 1A, Risk Factors, to our annual report on Form 10 ks for the year ended 12/31/2024. Abbott undertakes no obligation to release publicly any revisions to forward looking statements as a result of subsequent events or developments, except as required by law. On today's conference call, as in the past, non GAAP financial measures will be used to help investors understand Abbott's ongoing business performance. These non GAAP financial measures are reconciled with the comparable GAAP financial measures in our earnings news release and regulatory filings from today, which are available on our website at abbott.com.

Note that Abbott has not provided the related GAAP financial measures on a forward looking basis for the non GAAP financial measures for which it is providing guidance because the company is unable to predict with reasonable certainty and without unreasonable effort the timing and impact of certain items, which could significantly impact Abbott's results in accordance with GAAP. Unless otherwise noted, our commentary on sales growth refers to organic sales growth, which is defined in the press release issued earlier today. With that, I will now turn the call over to Robert.

Thanks, Mike. Good morning, everyone, and thank you for joining us. At the halfway point of the year, we are on track with our key priorities and objectives. In the first half, we delivered high single digit sales growth, over 100 basis points of margin expansion in both gross margin and operating margin, double digit earnings per share, and we achieved a number of important milestones related to advancing key programs in our new product pipeline. Our sales growth excluded COVID testing sales was 7.5% in the second quarter and 8% in the first half of the year.

Our second quarter adjusted earnings per share of $1.26 exceeded the consensus estimate and reflects 11% growth versus the prior year and 16% growth on a sequential basis compared to the first quarter. I'll now summarize our second quarter results in more detail before I turn the call over to Phil. I'll start with Nutrition, where sales increased 3.5% in the quarter. Growth in the quarter was driven by 6.5% growth in adult nutrition where Abbott is the global market leader. We continue to see strong demand for our Ensure and Glucerna brands in the markets around the world.

And this growing demand is driven by consumers seeking a source of complete and balanced nutrition, especially for those focused on protein rich diets and meeting the dietary requirements for managing diabetes. Moving to diagnostics, sales declined 1.5% in the quarter predominantly due to the year over year decline in COVID testing sales and the impact of volume based procurement programs in China. Together, these represent a projected headwind of around $700,000,000 or seven fifty basis points on the full year 2025 sales growth in diagnostics. Excluding China, Core Lab Diagnostics grew 8% reflecting strong underlying demand in the markets around the world. Turning to EPD, our sales increased nearly 8% in the quarter, driven by strong performance in our key 15 markets, which surpassed $1,000,000,000 in quarterly sales for the first time.

Key 15 markets include India, China and other markets across Asia, Latin America and Middle East. These markets represent the most attractive areas of growth for branded generic medicines. The growth in these markets is supported by favorable long term healthcare, economic demographic trends including higher birth rates, an expanding middle class aging populations and growing demand for access to high quality healthcare solutions. We serve this growing demand by offering a broad portfolio of branded generic medicines tailored to local conditions with a focus on key therapeutic areas. And additionally, we continue to make good progress toward building a best in class portfolio of biosimilars, having completed 10 regulatory approval submissions across a range of emerging markets with launches projected to begin in 2026.

And I'll wrap up with medical devices where sales grew 12% driven by double digit growth in diabetes care, heart failure, structural heart, electrophysiology and cardiac rhythm management. In diabetes care, sales of continuous glucose monitors were $1,900,000,000 in the quarter and grew 19.5%. In April, we announced a first of its kind collaboration with Epic, enabling direct integration of Libre sensor data into the leading electronic health record system. This seamless integration allows healthcare providers to easily view their patients' glucose data before, during, and after meeting with patients, supporting our goal of simplifying care to help deliver better outcomes for both healthcare providers and patients. In electrophysiology, we had several key accomplishments in the quarter, including delivering another quarter of double digit sales growth, initiating the launch of our new Volt PFA catheter and completing enrollment ahead of schedule in our Tactiflex Duo US pivotal trial.

In structural heart, growth of 12% was led by a combination of continued share gains in TAVR, strong adoption of TriClip and contributions from Amulet and MitraClip. During the quarter, we achieved several important milestones that demonstrate our commitment and progress toward expanding our portfolio of solutions to treat mitral valve disease. As the market leader in mitral valve repair, we continue to invest in the success of MitraClip. So in addition to currently pursuing a label expansion to increase the addressable market, we recently launched a next generation version of MitraClip that further enhances the procedure with improved deployment and deliverability. To accompany our leading position in mitral valve repair, we expanded our focus several years ago to include the development of mitral valve replacement technologies and in May we announced FDA approval of our Tendine Mitral Replacement Valve which offers a new treatment option for those who are not candidates for open heart surgery or mitral valve repair procedure.

And at New York Valves Conference a few weeks ago, we provided an encouraging update on the development of our new transfemoral mitral valve replacement product. We acquired this innovative technology as part of our venture investments program, which led to the acquisition of Cepheia Valve Technologies in 2019. And following that acquisition, we continue to iterate and enhance the technology and the FDA recently granted breakthrough designation. We plan to start the pivotal trial next year and look forward to creating a new solution to help treat the world's most common heart valve disease, which impacts the lives of millions of people around the world. In Rhythm Management, our strong performance is a result of our strategy to build a comprehensive portfolio capable of significantly outperforming the market and our own historical growth rates.

Our growth this quarter of 10% was led by strong uptake of Avera, our innovative leadless pacemaker, which is driving growing adoption of leadless pacemakers in both the single and dual chamber pacing segments of the market. In April, we announced late breaking data from the AVAIR Conduction System Pacing Feasibility Study. This was the first study to evaluate using a LEVIS pacemaker to deliver a conduction system pacing, which is a novel approach to pacing that closely mimics the heart's natural electrical rhythm. Following the successful outcome of this study, we are targeting to start the pivotal trial next year. In our heart failure business, often overshadowed by other high growth businesses in our medical device portfolio, sales grew 14% in the quarter.

This was driven by balanced growth across the portfolio which included double digit growth in ventricular assist devices used to treat both chronic and acute conditions and double digit growth in CardioMEMS, our implantable sensor for the early detection of heart failure. Vascular growth of 3.5% was led by double digit growth in vascular imaging and vessel closure products and increasing contributions from ESPRIT, our below the knee resorbable stent. Lastly, in neuromodulation, growth of 4% was led by strong performance of our Aeterna rechargeable spinal cord stimulation device in international markets reflecting both continued uptake in existing markets and launches in new markets. So in summary, our diversified model continues to provide a strong foundation that is both resilient and designed to sustainably deliver top tier results now and in the future. And that's evident in our performance in the first half of the year, which along with our outlook for the remainder of the year and the momentum heading into next year aligns with our long term sustainable growth objectives of delivering high single digit growth, healthy margin expansion and double digit EPS growth. I'll now turn over the call to Phil.

Thanks, Robert. As Mike mentioned earlier, please note that all references to sales growth rates, unless otherwise noted, are on an organic basis. Turning to our second quarter results, sales increased 6.9% or 7.5% when excluding the COVID testing related sales. Adjusted earnings per share of $1.26 increased 11% compared to the prior year and was above the consensus estimate. Foreign exchange had a favorable year over year impact of 0.5% on second quarter sales.

During the quarter, we saw The U. S. Dollar weaken, which resulted in a favorable impact on sales compared to exchange rates at the time of our earnings call in April. Regarding other aspects of the P and L, the adjusted gross margin profile was 57% of sales, which reflects an increase of 100 basis points compared to the prior year. Adjusted R and D was 6.3% of sales and adjusted SG and A was 27.7% of sales.

Adjusted operating margin was 22.9% of sales, which also reflects an increase of 100 basis points compared to the prior year. Based on current rates, we now expect exchange to have a relatively neutral impact on our full year reported sales, which includes an expected favorable impact of approximately 2% on our third quarter reported sales. And lastly, for the third quarter, we forecast adjusted earnings per share to be in the range of $1.28 to $1.32 With that, we'll now open the call for questions.

Thank you. At this time, we will conduct a question and answer session. As a reminder, to ask a question, you will need to press 11 on your telephone. You will then hear an automated message advising you that your hand is raised. To withdraw your question, please press 11 again.

For optimal sound quality, we kindly ask that you please use your handset instead of your speakerphone when asking your question. And our first question will come from David Roman from Goldman Sachs. Your line is open.

Thank you and good morning. I appreciate you taking the question here. Maybe, Robert, you could start by just putting 2025 performance into context for us. As I listen to the walk from the prior guidance to the updated guidance, I think it's pretty clear that it comes from some factors outside The U. S.

In diagnostics plus COVID diagnostic headwinds. But maybe you could help us think through the headwinds you're seeing this year, the extent to which those are transient versus more permanent changes in the growth rate and what that looks like next year.

Sure, David. I guess I'll just start off with our goal is to always ensure that every one of our businesses is meeting and beating. The reality is in the portfolio of Abbott and the complexity and the broadness that we're geographically across the different types of products. You're going to have some businesses that will fall short time to time and others do better. And we've seen that time and again.

The goal here, David, is always to really take all of that complexity and just translate into reliable and sustainable growth. That's what we've been doing this year. So when you say characterize your growth this year, listen, we've got a device business that for the first half of the year has grown over 12%, double digit growth in a lot of our businesses. Our pharma business has done very well, 8% growth in the first half, building biosimilar portfolio. Nutrition, first half about 5%, which is in the range that we've always expected them now that we've lapped a lot of the market share kind of recovery process here.

So really the challenge that we've had, is twofold here. It's really a drop off on our COVID testing sales, and some challenges in the China Core Lab market together with some changes that we've seen in The US foreign aid funding for HIV testing. So, look at that and say, okay, I'm not sure these are impacts that are 100% definite in the second half of the year, but I'm not going to sit here and try and kind of forecast what COVID testing is going to do. We had expected to see a China recovery in volume. We knew the price impact in China Core Lab, David, and we rolled that into our guidance.

We had expected a market volume recovery to start happening in quite frankly starting in Q2. We haven't seen that, so we've moved that out into Q4. But you put all that together, together with the funding for HIV testing, that's over $1,000,000,000 of, I guess, of headwind. And even with that $1,000,000,000 we're still forecasting high single digit growth and absorbing the impact of tariffs, which we now expect to be just under $200,000,000 of impact. FX, as Phil kind of said in his comments, still a headwind versus prior year on the EPS side, but much less of a headwind than what we had originally kind of anticipated back in January and quite frankly, April 2.

So that helps offset of the tariff impact. So I put this all together and you got it'll be nice, David, to lap these or to see these headwinds behind us next year. And then as you look to next year, you got all this great launch activity across all the businesses, whether it's Volt in The U. S, Tactiflex Duo internationally, the dual analyte sensor, the launch of the new Alinity system, the biosimilar kind of rollout. So I look at all of that and I say, okay, you've got this headwind that we're facing here.

Still, we're committing to high single digit growth and double digit EPS growth. And then as you look into 2026, those headwinds aren't going to be there. And then you've got all this kind of great momentum, which I'm sure we'll talk about in other parts of the business. So I look at 2026, I look at I know what the consensus are. They look very, very reasonable to me, in that range of high single digits, double digit EPS.

It's in line with our historical growth. It's in line with the guidance we've given this year. And it's in line with what our long term sustainable growth targets are. So, yes, it'll be good to see these elements here that I've just kind of highlighted that are specifically to diagnostics. And I'll just take it a step further here.

Mean, if you look at our and I mentioned this in the opening comments here, our Core Lab business outside and I hate doing this, but I think it gives context. If you look at The U. S. Up 78%. The European region was up 8%.

Our Latin America region was high teens. So our Core Lab business is doing very well. Alinity is doing very well. We just got this issue that we're going to have to go through this year as it relates to VBP and the disruption that happened in our Core Lab business in China. But we're still very bullish on this segment.

We still believe it's a very important part of the healthcare system. So, like I said, looking forward for these headwinds to be behind us, and we're well set up for next year.

That's very helpful. Maybe I just push a little bit harder on one point there. If I look at the guidance for this year, it's really kind of 8.5% when you take out some of those onetime headwinds. One thing you didn't mention was, obviously, EP, you face a little bit of a portfolio gap this year, and that looks to fully resolve as you head into the back half of the year and into next year. So is there a scenario in which we could see some of these onetime headwinds reverse and see the growth rate accelerate into 2026 and correspondingly see that fall through to the bottom line, recognizing that it's early to talk about 2026, but just conceptually some of these headwinds fading and some of those pipeline drivers starting to kick in more significantly?

Yes. Listen, there's definitely a scenario where you could see that growth rate accelerate, right? I mean, it's a little bit early to kind of put a full stop on that. But there's definitely opportunities across the portfolio, which we'll talk about likely that says, hey, mentioned electrophysiology. That's been one part of our portfolio that has consistently exceeded the expectations, both expectations, quite frankly, that you guys have had and the expectations that we've had.

Yeah, I mean, there's definitely opportunity as these reverse out to see that acceleration. Maybe a little bit early to say that, but right now, in terms of where we're sitting for '26, I feel very comfortable with that.

Excellent. Appreciate you taking the questions and bearing with me here as I have a cold today. Thank you.

Thank you. Our next question will come from Robbie Marcus from JPMorgan. Your line is open.

Great. Good morning. Thanks for taking the questions. Two for me. I'll ask them both upfront, both product questions.

Diabetes and EP, both performed really well in the quarter, particularly U. S. Libre. It was good to see U. S.

Double digit EP. Maybe just walk through some of the trends you're seeing in each of those product lines. Especially in diabetes, there was a lot of buzz around ketone integration and that product coming from Abbott. So what are you seeing in diabetes and then also EP, especially now with Voalte launching outside The U. S? Thanks.

Sure, Ravi. Yes, another great quarter of Libre, almost 26% in The U. S, an acceleration internationally also. I think all three segments we're seeing great momentum. So, you look at the intensive insulin user segment, obviously that's been a key growth driver for the market.

But there's still segments there that are underpenetrated and we're seeing nice growth in there. And the new sensor you referenced, I think is to definitely accelerate there. The basal segment's doing very well. A big growth driver for us, still market leader here. Our view globally is we've got about a 70 share.

Know some of the markets that have kind of began reimbursing for Basal, Robbie. We're starting to see more markets go down this path and start reimbursing basal, whether it's like specific tenders and regions or different parts of healthcare systems. That's good and we see like sustainability to that growth rate and our position in international markets. And the non insulin user segment is doing very well, very nicely too. I mean, think, right now you've seen commercial coverage here in The United States, I'd say around about 30% is what we're seeing, and that's doubled over the last three years.

So, think the trends are doing very nicely there. And I could see that continuing for the foreseeable future as part of our road to $10,000,000,000 in revenue. Your question on, or at least your comment on the dual analyte sensor, think this is going to be a real next level kind of, I'd say, significant change in the CGM market specifically for the intensive users. Ketone monitoring helps prevent diabetic ketoacidosis. We have a legacy of being in that.

We were the first company to develop a blood test, a rapid blood test for that many decades ago. So, we know how important it is. It could be life threatening. The ADA conference you referenced, I thought there was some interesting clinical data that showed thirty percent of pediatric patients and forty percent of adult participants saw like, in this trial saw like increased ketone levels that put them at risk, if there was an interruption on insulin delivery. There's clearly a need, for this patient segment.

I think you saw all the announcements that came out during the conference with all the pump integration. So there's clearly a need there, it's understood. And an opportunity to expand even further. We know that ketone monitoring here is going to create a path for doctors to prescribe SGLT2s for type ones. These are great drugs that offer a lot of cardiovascular benefits, but they come a DKA risk.

So we think that's gonna have a huge opportunity too. So good trends in the existing segments right now, Ravi. And I think that our position is just gonna be strengthened even more as we bring out the innovation. And so looking forward to that. I think on your question on EP, yeah, we saw good double digit growth in EP this quarter, double digit growth last quarter.

Saw an acceleration in The US growth rate this quarter versus last quarter. And a lot of attention now shifting towards rolling out of Volt to the international markets. We like to launch our products in a more kind of limited fashion. So, you move from clinical trials to full out launch, we like to have this little period in between here, Ravi, where we get to just put it out in a little bit more of an environment that we can just make sure that we're clearly understanding and getting all the feedback in a more direct fashion. When you go a little bit more focused, you get a great opportunity to do that.

So, really focusing right now on the sites that we're enrolled in our trials, the feedback's been excellent. I think that it stacks up very well versus competitors. I think the balloon design is perfect for PVI. I think it optimizes a lot of the process. And if you think about where prior balloon based systems were used in Europe, I think this fits very nicely there.

But its efficacy is great. Parasixmal data is best in class. As we said during the period we were talking about the development of VOLT, we believed in mapping and contact and visualization of contact. And I think that's what we're seeing from these early cases here, just providing really real time feedback on tissue contact. That leads to fewer applications, leads to less fluoro time, leads to less muscle contraction, which I think is really important if you think about some of the segments globally that are going to start to really advance in terms of market segments, segments that will benefit by having a procedure that can be done without general anesthesia and just with general sedation.

And I think Volt fits very nicely into those segments there too. So, far so good. The team's doing a great job. They've been doing a great job over the last couple of years. And I think they're excited now to transition to this phase of the strategy now, which is now that we've gained a lot of market share with mapping.

And it's now to bring in the PFA catheter that we think is very competitive.

Thank you. Our next question will come from Larry Biegelsen from Wells Fargo. Your line is open.

Good morning. Thanks for taking the question. Robert, I just wanted to ask one follow-up question or multi part follow-up question on Libre. So first, I'd love to get your reaction to the proposed competitive bidding for CGM and what that could mean for you. Second, the RFK Jr. Comments on wearables, do you think that could accelerate type two non insulin CMS coverage? And just lastly, on the dual ketone sensor, do you think that could drive share gains for you in intensive insulin patients where your share is lower? Thank you.

Sure. So three parter. So on competitive bidding, Larry, listen, there was nothing unexpected in the CMS proposal document here. I don't think there's any major changes as it relates to CGM. If CMS chooses to go down the competitive bidding route, it's really going to be the DMEs that are going to be the ones doing the bidding, not the CGM manufacturers.

I think this is probably going to take a couple of years to fully implement the process. And I expect there to be an impact on Abbott, but we're going to continue to monitor. And as I've said in other situations, one of the things that we've got to keep on doing here is to be the leader of scale, leader of cost. And, so, we'll continue to monitor and, we'll be ready. Your other question was regarding, the comments from the Secretary of HHS, regarding wearables.

Wearables, are powerful. We've known this, since we've launched Libre. They're very powerful, behavior modification tools And behavior modification has really proven to really drive significant impact on one's health. So, think you can keep your glucose levels in a healthy range, it offers a lot of benefit. There's lower risk of diabetes, heart disease, it helps with weight loss, we've seen that, improves productivity, etcetera.

So, I appreciate the Secretary's efforts here promote improving the health and wellness of all Americans. And I think that's in line with our company's mission and certainly supportive of this initiative. We hope that it would be Americans wearing CGMs that were made in The United States. We have two manufacturing sites. But anyways, we support that initiative.

And then, I think your question was regarding the continuous glucose ketone sensor. Do we think that that can accelerate our share gain? 100%, yes.

Thank you. Our next question will come from Vijay Kumar with Evercore ISI. Your line is open.

Hi, Robert. Good morning and thanks for taking my question. I had one product related and one P and L question. The product side, your CRM is doing really, really well. How I guess, are there any metrics you could share on what what percentage of your installed base has been updated or convert to a beer?

Where are we in the in the in the conversion cycle? And and is this now like a double digit or teens for the foreseeable future? What do you think is the ultimate TAM for this kind of product is?

I think it's fundamentally changed the growth trajectory of our CRM business. And now you're trying to ask yourself, okay, is this a one off thing or can we bank on this? If you look at the trajectory of our CRM business, 2023 when we launched single chamber, our growth rate was 7%. 2024, it was 7%. First half this year, it's 8%, showing 10% growth this quarter.

I think that achieving this very sustainable. I've talked about what we wanted to do with Avera in the past. You've got a $4,000,000,000 global pacing market that really hasn't seen much innovation, Vijay. And what we wanted to do was to really make sure that as we rolled this out, we weren't just looking for a niche jump in sales and then that's it. So, the team has done a really good job here in terms of coordinating between marketing and clinical and sales.

I think these teams have now really gotten full, are really aligned. I think they're really hitting their stride here to be able to look at expanding not just in The US, but also internationally. Think the work that they're doing here to be able to get physicians trained and hospitals set up, and It's a little bit of a different implant procedure, you do need to go through that. But we took our time to do this and do this right, and I think we're seeing the benefits here of taking that time to do it right. I think it's really driving uptake, just in single, but without a doubt in dual chamber.

Abbott Laboratories (ABT) Q2 2025 Earnings Call Transcript

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